railroad company is not unconstitutional. It is authorized by the first section of art. 9 of the constitution of the State. This section gives authority to tax corporations, &c., owning or using franchises, in such manner as the legislature shall from time to time direct. There is nothing in the constitution which prohibits the legislature from appointing different persons to ascertain the value of the property of different classes of persons.

The objections which are being considered under this head have been overruled by the Supreme Court of the State. TaxInjunction Cases, 23.

4. The objection that the board of equalization acted without notice has also been overruled by the Supreme Court. Tax-Injunction Cases, 34; Adsit v. Leib, 76 Ill. 201. See also Missouri River, &c., R.R. Co. v. Morris, 7 Kan. 210.

5. The objection to the assessment of the capital stock and franchise of the company by the State board of equalization, and to the manner in which it was done, is also overruled by the decisions of the Supreme Court of the State. Porter v. Frankfort, &c., R.R. Co., 76 Ill. 561; Republic Life Insurance Co. v. Pollock, Tax-Injunction Cases, 35; C., B., & Q. R.R. Co. V. Cole, id. 43.

These are questions peculiarly within the province of the State tribunals, and their decisions are binding on this court. Nesmith v. Sheldon, 7 How. 818; Carpenter v. Page, 17 id. 462; Wetherspoon v. Duncan, 4 Wall. 217; Delaware R.R. Tax Cases, 18 id. 231; Hamilton Co. v. Massachusetts, 6 id. 633; Lane Co. v. Oregon, 7 id. 71; Bailey v. R.R. Co., 22 id. 604.

Mr. R. G. Ingersoll, for the appellees, submitted the following points:

First, The revenue law of 1872 provides only for taxation by valuation, and has nothing to do with an excise or license tax.

Second, The taxing power can only be exercised upon property within the jurisdiction of the body imposing the same. Third, Real estate can only be taxed at its actual situs. Fourth, The situs of the rolling-stock of a railway corporation is where the general office of such corporation is.

Fifth, Personal property cannot be changed into real estate, and real estate into personal property, for the purposes of taxa

tion.

Sixth, Indebtedness cannot be taxed as against the debtors. Seventh, The rules laid down by the board of equalization for the ascertainment of value cannot produce a correct valuation. Eighth, The principle of uniformity has been violated.

Ninth, The Constitution of Illinois places the property of corporations and individuals upon an equality.

Tenth, By the law of 1872, corporations are denied privileges and rights accorded to individuals.

Eleventh, The board of equalization cannot disregard the sworn returns of the railway company, and cannot raise the valuation without evidence justifying it, nor then without notice to the company.

Twelfth, It is unlawful to classify property according to

owners.

Thirteenth, The assessment by the board was fraudulent, and made not only without evidence, but contrary to evidence.

Fourteenth, The Supreme Court of the United States is not bound by the decision of the State court in this case, even if such decision stood unquestioned by the State court.

Fifteenth, In any event, where there are conflicting decisions by the State court, this court has the power to follow those decisions which are in accordance with the constitution of the State.

In the second case, Mr. James K. Edsall, Attorney-General of Illinois, appeared for appellants. See abstract of his brief, infra.

Mr. C. Beckwith and Mr. Obadiah Jackson for appellees, submitted,

1. The decisions of the Supreme Court of Illinois are not conclusive.

The complainants insist that the assessments set forth in their bill are prohibited by that clause of the Fourteenth Amendment of the Federal Constitution which provides that "no State shall deprive any person of life, liberty, or property, without due process of law."

State laws and constitutions are construed by the Federal courts according to their own judgment in all cases where it is necessary to determine whether a right secured by the Federal Constitution has been violated. Jefferson Bank v. Skelly, 1 Black, 436; The Hoboken Bridge, 1 Wall. 116; Ward v. Maryland, 12 id. 418; Delmas v. Ins. Co., 14 id. 661.

2. The mode of assessment adopted in this case is not warranted by the constitution and laws of the State.

3. The constitution of the State does not authorize an assessment of the franchise of a corporation by valuation.

An excise tax may be imposed under art. 9 of the State constitution upon a franchise, in the same manner as such a tax may be imposed upon jugglers, showmen, &c., having special privileges. The constitution did not intend to permit double taxation; that is, on a valuation and by an excise tax.

The rule of assessment adopted by the State board is unjust, as it compels the payment of taxes upon debts.

Mr. P. Phillips also for appellees.

The Federal courts have jurisdiction of the case, both on the ground of citizenship and to prevent a multiplicity of suits.

The restriction in the thirty-fourth section of the Judiciary Act of 1789 applies only to trials at common law: it does not apply to the decisions of the State courts upon questions of a general nature. Nives v. Scott, 13 How. 271; Russell v. Southard, 12 id. 144; Watson v. Tarpley, 18 id. 517.

The nature of taxation, what uses are public and what private, and the extent of unrestricted legislative power, are matters which no State court can conclusively determine for us. Olcott v. Supervisors, 16 Wall. 678; Township v. Pine Grove, 19 id. 671.

The question, then, for the determination of this court is, whether the "rules and principles " adopted by the board are "just and equitable."

The debt of the corporation is not part of the possessions of the corporation, but is property belonging to the creditor who holds it. State v. Thomas, 2 Dutch. 184; State Tax, 15 Wall. 320; Bradley v. People, 4 id. 459.

The rule, therefore, adopted by the board is based upon valuations, not of the property of the corporations, but of property belonging to others.

This is a departure from the authority conferred. A discretion so exercised cannot be substituted for legal requisition. Bank of Chemung v. City of Elmira, 53 N. Y. 52.

The rule adopted does not secure the uniformity demanded alike by just principles of taxation and constitutional guaranties.

The mode of distributing the assessed value of the property of the company, so as to subject it to taxation in the several counties and towns without regard to the real location of the property, is also illegal.

The State cannot transfer property from a county in which it is located into another, and thus subject it to a different rule of taxation than that which obtains at its situs. Bank of Commerce, 2 Black, 631; St. Louis v. Terry Co., 11 Wall. 430.

In the third case, Mr. James K. Edsall, Attorney-General of the State of Illinois, and Mr. Lyman Trumbull, appeared for the appellants.

Mr. Edsall contended,

I. Under the statutes of Illinois, railroad corporations may be assessed upon their capital stock and franchises.

II. The meaning of the terms "capital stock, including the franchise" (with all other questions involved in the present cases), has been determined by the Supreme Court of Illinois. These decisions, being unreported, are referred to as "Illinois Tax-Injunction Cases," printed in pamphlet form.

In these cases it is held,

1. That the words "capital stock" mean the property of the corporation, and not the shares of stock owned by the shareholders.

2. That it was competent for the legislature to require the "capital stock" of corporations, as thus construed, to be assessed for the purpose of taxation against the corporation.

3. That the franchise of a corporation is property, and as such may be taxed, in proportion to its value, the same as other property. Illinois Tax Injunction Cases, pp. 3, 36.

III. The rule adopted by the board to ascertain the value of the "capital stock and franchise" of a corporation is at least theoretically correct.

This rule is, in substance, as follows:

"First, The market or fair cash value of the shares of capital stock and the market or fair cash value of the debt (excluding from such debt the indebtedness for current expenses) shall be combined or added together; and the aggregate amount so ascertained shall be taken and held to be the fair cash value of the capital stock, including the franchise, respectively, of such companies and associations.

"Second, From the aggregate amount, ascertained as aforesaid, there shall be deducted the aggregate 'amount of the equalized or assessed valuation of all the tangible property, respectively, of such companies and associations."

This mode of taxing corporations upon their capital stock is upheld in other States. Commonwealth v. Hamilton Manuf. Co., 12 Allen, 298; Munroe Co. Savings Bank v. Rochester, 37 N. Y. 366; Osborn v. N. Y. & N. H. R.R. Co., 40 Conn. 491.

This mode of taxing corporations was recommended by the commissioners appointed in 1870 by the legislature of New York.

The board of equalization having jurisdiction, their action is conclusive, even though they may have erred in their judgment. The People v. Halsey, 53 Barb. 548.

IV. The assessment does not appear to be excessive.

V. The decisions of the Supreme Court of a State, as to the proper construction of its revenue laws, are conclusive on the Federal courts.

VI. The assessment in question being confided to the State board of equalization, its action cannot be collaterally impeached for mere error in judgment, but only for fraud, accident, or mistake.

Mr. O. H. Browning and Mr. Wirt Dexter for the appellees. I. The assessment for capital stock is illegal and void under the first clause of sect. 1, art. 9, of the Constitution of Illinois.

First, Because the law under which the assessment was made is unconstitutional. Solamons v. Laing, 14 Jurist, for Dec., 1850; Dodge v. Woolsey, 18 How. 343; Van Allen v. The Assessors, 3 Wall. 583, 584; Bradley v. The People, 4 id. 459;